Global Trend

The New ISPs In the Sky
 
Today’s communications satellites are based on the same geo-synchronous approach that we’ve used for over 50 years.  Enormously expensive satellites sit in fixed positions over the equator, restricting coverageand competing for bandwidth.

The alternative idea of Low Earth Orbit (or LEO) networks started in the 90s as well-funded efforts to provide mobile telephony to anyone, anywhere on the surface of the Earth.  But those projects, including the initial versions of Iridium and Globalstar, failed to deliver on the hype because of technology constraints, coupled with poor business models.

Now 25 years later, projects are underway to make that vision commercially successful.

Why should this new spate of projects fare better than the originals?  One reason is that satellites can now be made much smaller and lighter, so launch costs are significantly lower.  More importantly, the size, manufacturability and component costs associated with the different terminals and handsets have plummeted since those early days, while functionality and ease of use have increased. There have also been significant advances in solid-state antennas for LEO satellite terminals, which need to track a satellite as it moves across the sky and transfer seamlessly to another satellite when the first satellite approaches the horizon. Meanwhile, satellite solar cell efficiency has more than doubled since the early days and power amplifier efficiency has also surged.

While these factors have helped strengthen the business case, uncertainties remain about demand, as well as ever-present regulatory constraints placed on frequency allocations for LEO satellites.

Notably, while the original investors in Iridium and Globalstar lost their money, both “satellite constellations” were built and have been operating for over 15 years.  Furthermore, the companies have successfully raised money for second-generation constellations with Globalstar’s latest iteration launched in 2016 and Iridium’s “NEXT constellation” satellites scheduled to be fully operational in 2018.

Of the new entrants, analysts believe the most likely one to succeed is OneWeb, backed by Virgin Galactic, Qualcomm, Hughes Network Systems, and Airbus Defense and Space, as well as legacy satellite network operator Intelsat.  Interestingly, Coca Cola is also involved.
 
OneWeb is planning a constellation of 650 active Ku-band satellites (plus 250 spares), each weighing only 68 lbs, which would make them amongst the smallest and lightest communications satellites designed for commercial service.

Inter-satellite links are not planned, so the system will need many terrestrial gateways ? which is where the commercial link with Intelsat comes into play.  The cost of these and other ground control facilities, as well as designing, building and launching the satellites, is expected to reach $7.5bn.  To date, the group has raised some $500 million, mostly from its many commercial backers. Airbus will build the satellites, which are expected to be launched into 20 orbital planes at an altitude of about 1200km.  Each satellite is expected to cost $500,000.

OneWeb has also demonstrated various prototypes of user terminals, including some operated by solar power. They will offer combinations of LTE, 3G, 2G and Wi-Fi and are estimated to cost just $250 per terminal.  The first 10 satellites will allow testing of the network and terminals to be completed by year-end 2017, with the entire constellation to be ready by late 2019. The bulk of the satellites will be made in the US.

Meanwhile, SpaceX is rumored to have received a $1 billion investment from Google and additional support from financial company Fidelity to fund a constellation of 4000 satellites orbiting at a 625km altitude.  It has requested permission from the FCC to commence trials with up to eight experimental satellites, dubbed MicroSat-1a and MicroSat-1b, operating in the Ku and Ka bands, respectively.  It’s a natural way to diversify, while generating private-sector launch revenue.

Elon Musk has suggested the network could deliver speeds and that would compete with terrestrial fiber. The trial satellites are expected to be launched, beginning in 2018, on SpaceX’s Falcon 9 rocket; but, like “everything Musk,” expect MicroSat to be late.  Projections about how much the SpaceX satellite project would cost range from $10bn to $15bn and few believe it could be fully operational until well into the next decade.
 
While entrepreneurs battle it out to offer Internet to the masses via their satellite constellations, electronics giant Samsung has laid out its own vision for ‘Space Internet’ to be created in the next decade.  The company has proposed 4600 ‘low-cost microsatellites in low-earth orbit, each capable of providing Tera-bit/s data rates, with signal latencies better than or equal to ground based systems.’  The satellites would weigh less around 200lbs and operate at altitudes of less than 2000km.
Samsung sees this as part of its evolving vision for 5G, an area in which Samsung continues to be a major innovator.  According to Samsung, “With the 5G vision of providing wireless access in the millimetre wave spectrum, a single standards-based wireless technology can be developed for access, backhaul and satellite communications, eliminating fragmentation and thereby reducing the costs of providing wireless services.”

The concept also relies on phased array radars: already a critical element of many 5G developments. These will be necessary to improve coverageand reduce interference.  Phased arrays allow the beam to be steered ‘with the flexibility and speed of electronics,’ rather than the slower and less flexible mechanical approach used for traditional parabolic dishes.
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While LEO satellites offer many advantages over traditional communications satellites and terrestrial networks, they aren’t the only game in town.  Projects using stratospheric balloons and high-endurance drones may make even more commercial sense when fully developed.
 
Let’s start with balloons.  Since it launched nearly four years ago, Alphabets Project Loon experiment has shifted from an unlikely “moonshot” to an idea that might actually work.  As Loon project management wrote recently, the project team has "now exceeded even their own expectations," in the attempts to build a network of self-navigating, internet-beaming balloons. "And, in the process, theyve leapt much closer to the day when balloon-powered Internet could become a reality for people in rural and remote regions of the globe."

In September 2016, the projects engineers showed how the system learned to ride air currents and stay in place over one area for months at a time.  The reason this is so exciting is that the team can now run experiments and test services in particular places of the world with just 10 to 30 balloons, rather than 200 to 400 balloons.

The Project Loon team has also improved the navigation and altitude control systems to allow for even more precise control, but the AI behind it can get even smarter.  Fewer balloons means operating costs are drastically reduced and service could be deployed to a new region in weeks rather than months, which is a huge advantageconsidering these are meant to deliver internet to remote regions of the world.
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Balloons are relatively cheap, easily launched, and readily updated, but they are remain relatively hard to navigate.  While satellites, are expensive to build, expensive to launch, and difficult to update once in orbit.  Drones overcome all of the drawbacks of satellites and balloons, but, they cant stay aloft very long.  Or can they?
Airbus recently announced the successful maiden flight of its Zephyr T aircraft, a drone powered only by sunshine. By flying far lower than satellites, drones could provide high-bandwidth links, using lasers to relay information to other drones or receivers on the ground, providing the sort of line-of-sight communication that isn’t possible with satellites that orbit the planet and disappear over the horizon.

Airbus started working on pseudo satellite drones in 2008, aiming to fill the "capability gap" between satellites in orbit and the low-altitude, limited drones of the day.  In 2010, Zephyr 7 smashed the world record for longest flight without refueling, staying aloft for 14 days. Airbus is now working to get that up to at least a month.

Given this trend, we offer the following forecasts for your consideration,

First, by 2030, a combination of LEO satellites will make broadband Internet service available to almost everyone on the planet.

Today, experts estimate that 5.7 billion people still lack reliable access to affordable broadband.  Solving this problem will provide a huge boon to education, commerce and communication without enormous investment.  A big advantageof LEO technology is that it can cover poor areas as well as rich ones with relatively low incremental cost. And,

Second, balloons and drones will be most successful where the objective is to target specific areas with dense under-served populations, like much of India.
That includes not only poor areas, but also affluent pockets where upgrading the “last mile” has become prohibitively expensive.  Balloons and drones are perfect for situations involving limited geographies.
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References
1. January 12, 2016. “Billions at stake as broadband satellite race intensifies.”

http://www.newelectronics.co.uk/electronics-technology/billions-at-stake-as-broadband-satellite-race-intensi-fies/112421/

2. Jun. 22, 2017. “Commercial balloons in the stratosphere could monitor hurricanes and scan for solar storms” by Adam Mann.

http://www.sciencemag.org/news/2017/06/commercial-bal-loons-stratosphere-could-monitor-hurricanes-and-scan-solar-storms

3. June 1, 2016. “Airbus Wants to Replace Satellites With High-Flying Drones” by Jack Stewart.

https://www.wired.com/2016/06/airbus-new-drones-actually-high-flying-pseudo-satellites/

4. BBC World Service. 11 November 2015. “Facebook’s laser drones v Google’s net-beaming balloons” by Leo Kelion.

http://www.bbc.com/news/technology-34780127